Check Fraud 101: How To Spot And Avoid

Check Fraud 101: How To Spot And Avoid

Check fraud can be defined as a type of scam that involves fake and altered checks. And you do not necessarily have to pay your bills through checks to become a victim of it. The fraudster may send you a check on which they have altered the name of the payee, the check could be fraud, or even counterfeit. There are many different types of check fraud ad a large number of people are affected by it with a large sum of money lost. However, the bad news is that it can take weeks to identify fraudulent checks. So, if you are writing a check, make sure to read up on How To Fill Up A Check, so that you do not leave any room for the scammers to modify the check if it falls into their hands.

Identifying The Different Types Of Check Fraud: Not a single individual is safe from check fraud, it can be committed by your customers or maybe perpetuated to your customers. Here are some of the different types of check fraud, you should be aware of. Paperhanging is when the account holder purposefully writes bad checks. Another common type is called check kitting, it happens when the account holder writes a bad check to create an illusion of balance in a second account. Check floating, is when the account holder tries to buy extra time after writing a check. Check forgery, check theft, identity check theft, chemical alterations, counterfeiting, and money order fraud are some common check fraud.

Penalties for Check Fraud: When a person commits check fraud, and if they are caught, they can face a wide range of penalties from fines, jail times, to paying restitution to the victims. When it comes to checking fraud, the larger the checks obtained are and the more asset they have stolen, the penalties become more severe. Check frauds can also fall under federal jurisdiction, although in most cases, it is usually treated as a state crime.

Detecting Check Fraud: To detect check fraud, you need to have the tools and the processes in your possession. Bank tellers should invest in machine learning software that can identify fraud checks based on the signature, and various different aspects depending on the spending habit of the account holder. If you are a check receiver, you need to be careful as there are many different types of check frauds.

How To Tell If A Check Has Been Altered: Altered checks are another common type of check fraud. These scam artists may steal checks and alter the wide range of information available on the check. They can change up the detail starting from the static information written by the account holder. To recognize these alterations in the naked eye may be impossible as they may not be visible. And only trained people and tools may be able to recognize the alterations.

Check Fraud Scammers Target: People of any age can be a victim of check scam; however, these check scams are primarily known to affect younger adults. The Better Business Bureau is of the view that younger adults, aged 20 to 29 are the most common targets as they more likely cannot differentiate between an authentic check and a fake one. Although people of any age group can fall into this trap, it is important to be aware of the different types of check fraudulent and how to avoid them.

To prevent check fraud, you need a tool that can help spot fraudulent checks. However, a fraud check will usually have a signature that does not match, different fonts, numbers out of order, or even wrong information.

 

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